what is a subprime mortgage

The vast majority of home mortgage loans r structured where they can be resold to investors. If they fall within certain guidelines they r what we used to call ''A'' grade, just below that would be ''B'' paper, then u get to lower grades. The lower grades came to be called ''sub prime'' because they were originally difficult to sell at all. Then a market developed for them as long as the interest rate was high enough.

What the investors seemed to ignore was that if the house got repossessed it did not matter how high the interest rate was- no one was paying the payments.